To increase its yearly refining (Future Indian Refineries) capacity to 9 million barrels per day (bpd), India may consider building smaller oil refineries, according to oil minister Hardeep Singh Puri, who revealed this on Tuesday. This is due to difficulties in procuring land.
India, the third-largest oil importer and consumer in the world has a capacity for around 5.2 million bpd of oil refinery output.
Since it is anticipated that India will account for a fourth of the increase in global oil demand by 2040, international oil companies view India as a reliable market for their oil.
Refineries are expensive. Because if I make it too huge then land acquisition and other obstacles come in the way, Puri said reporters on the sidelines of an industry event. “We are looking at a high amount of 20 million tonnes per annum, lesser ones.
He claimed that India needed to develop a plan for increasing its refining capacity to 9 million barrels per day.
One of the main causes of the third-largest economy in Asia’s slow infrastructure development is issues with land purchases.
Due to difficulties in procuring a 15,000-acre block of land for it, Reuters reported last year that India was considering building multiple refineries rather than a single 1.2 million bpd plant that was planned with Saudi Aramco and Abu Dhabi National Oil Company (ADNOC).
According to 2019 estimates, delays in procuring the site have nearly put a stop to the project, which was originally scheduled for 2025, and increased expenses by 36% to $60 billion.
When contacted for comment regarding the potential division of the envisioned massive refinery last year, the authorities remained silent.
According to Puri, new refineries will also produce renewable hydrogen and petrochemicals among other things.
Prime Minister Narendra Modi has established a 2070 net zero objective and is assisting businesses in developing green projects by offering a variety of incentives.
Along with increasing its capacity for renewable energy, India plans to establish its own 5 million tonnes per year of green hydrogen production capability by 2030.
India will develop into an energy hub, but it will be a green energy hub, according to Puri.